Eagle Industry Co., Ltd. Business Report FY ended Mar. 2015

Financial Overview

(in million JPY)
FY ended March 2015 FY ended March 2014 Rate of Change (%) Factors
Sales 138,150 124,709 10.8 -Steady sales at the Automotive & Construction Machinery businesses, and at the Marine Industry business.
Operating income 14,493 11,403 27.1 -
Ordinary income
16,750 14,523 15.3 -
Net income 9,510 7,426 28.1 -
Automotive and Construction Machinery Industries
Sales 85,335 77,700 9.8 -Even though sales of construction-machinery products were sluggish because of the slowing economy in China, sales of automotive products remained strong worldwide.


Outlook for FY ending Mar. 31, 2016

(in million of JPY)
FY ending Mar. 31, 2016
(Forecast)
FY ended Mar. 31, 2015
(Actual Results)
Rate of Change
(%)
Sales 145,000 138,150 5.0
Operating income 15,000 14,493 3.5
Ordinary income 17,000 16,750 1.5
Net income 11,000 9,510 15.7


>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)

Mid-term Management Plan

-The New Three-year Mid-term Plan announced in 2014 covers FY2014-2016 (April 2014-March 2017). It calls for developing globally efficient management and new products with long-term potential that make use of proprietary technical expertise. The following are the targeted figures by the final year.

  • Sales: JPY 150,000 million
  • Operating profit: JPY 15,000 million (profit margin of 10%)
  • Sales at Automotive and Construction Equipment: JPY 92,000 million (18% increase over FY2013 that ended March 2014)

Long-term Management Vision

-The Company aim to achieve net sales of JPY 202,000 million by FY ending March 2021.

R&D Expenditure

(in million JPY)
FY ended March 2015 FY ended March 2014 FY ended March 2013
Overall 1,496 1,163 755
-Automotive and Construction Machinery 1,057 862 474

R&D Structure

-The Company's Technical Center is the main function responsible for R&D activities in the Company, collaborating with the technical/engineering, production, and sales functions to develop products in all its business sectors.
-The Company has 85 staff working in R&D, accounting for 1.6% of its total workforce. (As of March 2015)
-August 2014 marked the completion of the new R&D center at the Saitama Factory. The center boasts a comprehensive R&D structure ranging from materials to product design and manufacturing technology.

R&D Activities

Automotive and Construction Machinery
-Mechanical seals for engine coolant circulation pumps:

  • Significantly reducing frictional force while at the same time maintain a high level of sealing performance by using its expertise on surface-texture technology.
  • Responding to high-heat/high-loads and the need for longer product life by using metal bellows.

-The Company is developing high-speed mechanical seals by using surface-texture technology.

  • Achieving a good balance between low torque and high sealing performance of high-revolution shaft-seal parts such as turbocharges.

-The Company completed development; and commenced mass production of a carbon bearing for electric water-pumps, which demonstrates excellent performance in terms of wear and abrasion resistance. The Company is developing carbon bearings that significantly reduce friction.

-Mechatronics Products: The following are currently under development:

  • Magnetic control valves using metal bellows.
  • Hydrogen gas control valves for use in FCVs
  • Products with metal bellows for use in control devices.

-R&D activities are being conducted on sliding materials for all types of seals.

Capital Expenditure

(in million JPY)
FY ended March 2015 FY ended March 2014 FY ended March 2013
Overall 11,761 8,178 8,527
-Automotive and Construction Machinery 6,760 4,840 6,182


Automotive and Construction Machinery
-In fiscal year ended Mar. 31, 2015, the Company made capital investments mainly to increase its production capacity, especially at the following locations.

  • EKK Eagle Industry Mexico S.A. de C.V.: JPY 1,221 million
  • Eagle Industry France S.A.S.: JPY 1,211 million
  • EKK Eagle (Thailand) Co., Ltd.: JPY 377 million
  • Eagle Simrax B.V.: JPY 373 million

-FY ending March 2016, capital expenditure is planed to be JPY 13,800 million overall.

Investments Outside Japan


-The Company plans to construct new plant in Hungary. The plant will be established in 2016 to manufacture engine valves.

Planned Capital Investment

(As of Mar. 31, 2015)
Facility
(Location)
Location Equipment to
be installed
Estimated amount of investment
(in million JPY)
Period of the project
from to
The Company's
Okayama Plant
Okayama Pref., Japan Equipment to produce mechanical seals 3,260 Apr.
2015
Mar.
2016
Equipment to produce special valves
Hiroshima Eagle Co., Ltd. Hiroshima Pref.,
Japan
Equipment to produce mechanical seals 344 Apr.
2015
Mar.
2016
Equipment to produce special valves
Eagle Industry (Wuxi) Co., Ltd. China Equipment to produce mechanical seals 421 Apr.
2015
Mar.
2016
Equipment to produce special valves
NEK Co., Ltd. Korea Equipment to produce mechanical seals 476 Apr.
2015
Mar.
2016
EKK Eagle (Thailand) Co., Ltd. Thailand Equipment to produce mechanical seals 315 Apr.
2015
Mar.
2016
Equipment to produce special valves
Eagle Industry France S.A.S. France Equipment to produce special valves 784 Apr.
2015
Mar.
2016
Eagle Simrax B.V. Netherlands Equipment to produce mechanical seals 454 Apr.
2015
Mar.
2016
Equipment to produce special valves
Eagle Industry Hungary Kft. Hungary Equipment to produce special valves 418 Apr.
2015
Mar.
2016
EKK Eagle Industry Mexico S.A. de C.V. Mexico Equipment to produce special valves 1,946 Apr.
2015
Mar.
2016

Data

  Mar. 2015 Mar. 2014 Mar. 2013
Automotive and Construction Machinery 2,788 2,718 2,527
General Industrial Machinery 2,052 2,006 1,990
Marine 217 217 232
Aerospace and Opt electronics 230 214 174
Administrative Division 44 47 49
Total 5,331 5,202 4,972

Sales by Segment

(in million JPY)
  FY ended Mar. 31, 2015 FY ended Mar. 31, 2014 FY ended Mar. 31, 2013
Automotive and Construction Machinery 85,335 77,700 60,019
General Industrial Machinery 32,344 29,668 27,865
Marine 12,902 11,227 10,140
Aerospace and Opt electronics 7,566 6,114 4,792
Adjusted amount - - -
Total 138,150 124,709 102,817

Sales by Geographic Area

(in million JPY)
  FY ended Mar. 31, 2015 FY ended Mar. 31, 2014 FY ended Mar. 31, 2013
Sales Ratio Sales Ratio Sales Ratio
Japan 69,764 50.5% 67,207 53.9% 62,879 61.2%
Others 68,385 49.5% 57,502 46.1% 39,938 38.8%
Total 138,150 100.0% 124,709 100.0% 102,817 100.0%

Consolidated

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.) 
FY ended
Mar. 31, 2011
FY ended
Mar. 31, 2012
FY ended
Mar. 31, 2013
FY ended
Mar. 31, 2014
FY ended
Mar. 31, 2015
Sales (million yen) 91,920 96,237 102,817 124,709 138,150
Income from ordinary business activities (million yen) 9,142 7,224 8,934 14,523 16,750
Net income (million yen) 4,871 3,013 4,501 7,426 9,150
Comprehensive income (million yen) 1,834 2,848 10,706 14,158 14,019
Net assets (million yen) 40,991 42,568 52,541 62,933 74,786
Total assets (million yen) 103,439 107,375 122,658 142,531 156,443
Book value per share (yen) 735.44 722.24 950.42 1,153.02 1,366.47
EPS (yen) 100.26 61.94 93.73 154.09 197.00
Diluted EPS (yen) - - - - -
Net asset ratio (%) 34.6 34.5 37.3 39.0 42.2
ROE (%) 13.8 8.3 10.9 14.7 15.6
PER 8.8 13.9 9.8 10.3 12.4
Cash flow from operating activity (million yen) 11,224 6,224 10,703 16,334 14,086
Cash flow from investment activity (million yen) (7,312) (11,404) (8,675) (11,659) (12,652)
Cash flow from financial activity (million yen) (1,465) (323) (1,498) (2,159) (2,044)
Balance at the term-end of cash and cash equivalents (million yen) 16,310 11,398 12,992 17,379 17,911
Number of employees 4,454 4,844 4,972 5,202 5,331

 

Non Consolidated

FY ended
Mar. 31, 2011
FY ended
Mar. 31, 2012
FY ended
Mar. 31, 2013
FY ended
Mar. 31, 2014
FY ended
Mar. 31, 2015
Sales (million yen) 58,193 60,451 73,444 87,322 96,310
Income from ordinary business activities (million yen) 2,484 2,404 4,099 6,140 7,787
Net Income (million yen) 2,188 1,768 5,464 3,641 5,083
Paid-in Capital (million yen) 10,490 10,490 10,490 10,490 10,490
Number of stock outstanding (1000) 49,757 49,757 49,757 49,757 49,757
Net assets (million yen) 30,184 30,830 35,931 39,016 42,122
Total assets (million yen) 85,541 88,330 96,525 105,556 112,396
Book value per share (yen) 620.33 643.45 746.29 808.86 871.85
Dividend per share (yen) 11.00 11.00 14.00 25.00 40.00
EPS (yen) 45.05 36.35 113.78 75.56 105.30
Diluted EPS (yen) - - - - -
Net asset ratio (%) 35.3 34.9 37.2 37.0 37.5
ROE (%) 7.5 5.8 16.4 9.7 12.5
PER 19.56 23.61 8.00 21.05 23.11
Payout ratio (%) 24.4 30.3 12.3 33.1 38.0
Number of employees 716 739 850 913 897